South Korea to launch special probe for ‘made in Korea’ violations ahead of US tariffs

South Korea’s customs authorities have launched a special investigation into alleged violations of country-of-origin rules in its trade with the United States, the Korea Customs Service (KCS) announced on Tuesday. The country expects to be direly affected by US President Donald Trump’s new round of tariffs, which will take effect next Wednesday.

Per a March 25 Reuters report, the probe will target South Korean companies exporting goods to the US to ensure compliance with the Free Trade Agreement (FTA) between the two nations. 

Officials want to prevent the mislabeling of foreign-made products as South Korean goods, which could lead to trade disputes.

KCS takes watch of export branding

Authorities will reportedly focus on high-risk goods, especially those already under US anti-dumping measures or subject to American customs surveillance. The KCS cautioned firms found disguising foreign goods as South Korean-made will face strict penalties.

“We are taking preemptive action to protect domestic companies as there are concerns from earlier experience during the first Trump presidency that US verifications might become stricter after imposing higher tariffs,” a KCS spokesperson said.

South Korea is one of only three Asia-Pacific nations with an FTA with the US, allowing near-total tariff exemptions on traded goods. 

Yet, Trump’s latest trade policy lex talionis, which replicates those from his first term, worries Seoul, which sees Washington enforcing trade agreement provisions more aggressively.

The Trump administration will implement reciprocal tariffs on trading partners on April 2. This follows the imposition of steep duties on imports from China, Canada, and Mexico over alleged non-compliance with their free trade agreements.

Companies negotiate tariff reprieve

Some South Korea-based companies have already started forming relationships with the American economy to shield themselves from fake branding and tariffs. Cryptopolitan confirmed on Monday that Hyundai Motor Group is expanding operations of its US branch with a $21 billion investment plan. 

The automobile industry giant will construct a $5.8 billion steel plant in Louisiana, which is expected to create over 1,400 jobs and supply next-generation steel to its American manufacturing facilities.

The investment was revealed at the White House, where Hyundai Chairman Euisun Chung, Louisiana Governor Jeff Landry, and President Trump discussed strengthening industrial ties between the two nations.

Hyundai Motor CEO José Muñoz told Axios back in January that “the best way for the company to shield itself from tariffs is to increase localization.” The company is Tesla’s competitor in the American electric vehicle (EV) market and already operates two plants in Alabama and Georgia.

Alaskan delegation pushes South Korea on LNG pipeline project

In other news, an Alaskan delegation led by Governor Mike Dunleavy arrived in South Korea on Tuesday to discuss energy cooperation. The visit comes against the backdrop of discussions between the US and Asian allies in a long-stalled liquefied natural gas (LNG) pipeline project championed by President Trump.

The delegation, which includes officials from the state-run gas agency and energy firm Glanfarne Group, met with South Korean Industry Minister Ahn Duk-geun to discuss trade and energy collaboration, including the $44 billion Alaska LNG project. 

Dunleavy also held talks with Governor Kim Dong-yeon of Gyeonggi Province, South Korea’s most populous region.

Energy-scarce South Korea is the world’s third-largest LNG buyer, after China and Japan, and is home to a large petrochemical industry. So far, no concrete agreements have been confirmed, but South Korean officials promised to participate in the pipeline initiative.

According to Dunleavy, Trump is seeking cooperation from South Korea, Japan, and Taiwan in securing buyers for Alaskan gas transported through the proposed 1,300-km (800-mile) pipeline. 

The governor insisted that the project must serve the interests of all involved parties rather than benefiting one side at the expense of others. 

Cryptopolitan Academy: Want to grow your money in 2025? Learn how to do it with DeFi in our upcoming webclass. Save Your Spot